### Allegheny Technologies Page 1 of 10
Search:

Products Operations About Us Investors News Careers Contact 

# News Allegheny Technologies Announces Strong First Quarter 201 CONTACT: Dan L. Greenfield (412) 394-3004 PITTSBURGH, Pennsylvania

-- April 21 , 2005 -- Allegheny Technologies Incorp( (NYSE:ATI) 

### ® Revenues increased 52% to $880 million ® Net income was $66.3 million, or $0.66 per share ® Operating profit increased to $114 million ® Segment operating margins as a percentage of sales: o Flat-Rolled Products 7.5% o High Performance Metals 24% o Engineered Products 12% • Net debt to total capitalization improved to 39.4% ® Cash on hand was $231 million Allegheny Technologies Incorporated reported net income for the first quarter 2( million, or $0.66 per share, on sales of $879.6 million. In the first quarter 2004, ATI reported a net loss of $50.4 million, or $(0.63) per of $577.8 million. "Our strong first quarter results are a good start to achieving the next level of su said L. Patrick Hassey, Chairman, President and Chief Executive Officer of Allel Technologies. "Robust demand from the early stage recovery of the commercial aerospace m^, High Performance Metals segment results. We continue to be encouraged by th market and cost position of our Flat-Rolled Products segment. Our Engineered I segment also performed very well and is becoming more important to our result! "AT[ sales increased by 52% compared to the first quarter 2004 and by more. the compared to the fourth quarter 2004. Overall segment operating profit improved million, and operating margins reached nearly 13% of sales. "Operating performance benefited from strong demand, higher selling prices, or reductions and capital investments, and from ATI Business System manufacturi "First quarter operating margin in our High Performance Metals segment excee( Demand was robust from the aerospace market for our titanium alloys, nickel-be superalloys, and vacuum melted specialty steels. In addition, our exotic alloys b another outstanding quarter due to continued government, corrosion, and medic strength. "First quarter results in our Flat-Rolled Products segment were good. We expec Shipments were 172,800 tons and segment operating margin was 7.5%. Operas costs were higher than expected as we balanced production flow in the first qua addition, some of our stainless steel sheet service center and tubing customers their inventories, which had risen at the end of 2004, due in part to an import sus December
. Stainless steel sheet imports through February 2005, the latest data returned to approximately the 2004 monthly average. Importantly , most end mai http://www.investquest.com/iq/a/ati/ne/eamings/atil 5.htm 8/8/2005 

### AlleghenyTechnologies

Products 

## News About 

# I Search:

# r=='----

Investors News Careers Contact 

## Technologies Announces Strong rst CONTACT: Dan L. Greenfield (412) 394-3004 

### Page 1of10



## 201

PITTSBURGH, Pennsylvania -- April 21, 2005 -- Allegheny Technologies Incorp< (NYSE:ATI)

® Revenues increased 52% to $880 million ® Net incomewas $66.3 million, or$0.66 per share ® Operating profit increased to $114 million ® Segment operating margins as a percentage ofsales: o Flat-Rolled Products 7.5% o High Performance Metals 24% o Engineered Products 12% ® Net debtto total capitalization improved to 39.4% ® Cash on hand was $231 million Allegheny Technologies Incorporated reported net incomeforthe first quarter

### 2( million, or $0.66 pershare, on sales of$879.6 million. In the first quarter2004, ATI reported a net loss of$50.4 million, or $(0.63) per**~** of$577.8 million. "Our strong first quarter results are a good startto achieving the next level ofsu said L. Patrick Hassey, Chairman, President and Chief Executive Officer ofAile! Technologies. "Robust demand from the early stage recovery ofthe commercial aerospace me High Performance Metals segment results. We continue to be encouraged byth market and cost position ofour Flat-Rolled Products segment. Our Engineered I segment also performed very well and is becoming more importantto our result: "ATI sales increased by 52% compared to the first quarter2004 and by morethi compared to the fourth quarter2004. Overall segment operating profit improved million, and operating margins reached nearly 13% ofsales. "Operating performance benefited from strong demand, higherselling prices, or reductions and capital investments, and from ATI Business System manufacturi "First quarteroperating margin in our High Performance Metals segment exceec Demand was robustfrom the aerospace marketfor ourtitanium alloys, nickel-be superalloys, and vacuum melted specialty steels. In addition, ourexotic alloys b another outstanding quarterdue to continued government, corrosion, and medic strength. "First quarter results in our Flat-Rolled Products segmentwere good. We expec Shipments were 172,800tons and segment operating margin was 7.5%. Operal costs were higherthan expected as we balanced production flow in the first qua addition, some ofourstainless steel sheetservice center and tubing customers their inventories, which had risen atthe end of2004, due in partto an import SUI December. Stainless steel sheet imports through February 2005, the latestdata returned to approximatelythe 2004 monthly average. Importantly, most end mal 

### http://www.investquest.comliq/a/ati/ne/eamings/atiI5.htm 8/8/2005

### Allegheny Technologies Page 2 of 10 flat-rolled products remained solid. "In our Engineered Products segment, operating margins increased to over 12°/ ATI Business System improvements and strong demand from several key mark, and gas, aerospace, and transportation markets as well as general manufacturii "We remain optimistic about the prospects for ATI. Backlogs in our High Perforn segment are at near record levels and lead times continue to lengthen. We expE demand for our materials used for jet engine after-market parts and new commE engines and airframes. In addition, we see continued strength for our exotic allo Rolled Products segment, capital goods markets are expected to remain strong. stainless steel service center supply chain inventories will be in balance by the E second quarter 2005. The global electrical steel markets for power distribution a added supply as that market gains momentum

. Markets for our Engineered Prof businesses remain robust."
Three Mont Marcr In Mil]

------------- 2005

Sales $ 879.6 Net income (loss) $ 66.3 Per Dilut Net income (loss) $ 0.66

First Quarter 2005 Financial Highlights 

### ® Sales were $879.6 million, 52% higher than the first quarter 2004. Sales i in the Flat-Rolled Products segment, 47% in the High Performance Metal 32% in the Engineered Products segment. ® Segment operating profit was $113.9 million, an increase of $113.3 milli( the first quarter 2004, as a result of improved performance across all thre segments. First quarter 2005 results included a LIFO inventory valuation of $5.7 million, due primarily to higher titanium scrap costs. The LIFO inventory valuation reserve charge was $z the first quarter 2004. • Net income was $66.3 million, or $0.66 per share. ® Retirement benefit expense was $20.2 million compared to $36.0 million primarily as a result of actions taken in the second quarter 2004 to contro medical costs and the favorable effect of the Medicare prescription drug 11 ® Cash flow used in operations was $4.7 million. Improved market conditio the further investment of $122.2 million in managed working capital. ® Cash on hand was $231.2 million at March 31, 2005. ® Cost reductions , before the effects of inflation, totaled $30 million compa quarter. Our 2005 cost reduction goal is $100 million. Flat-Rolled Products Segment Market Conditions 

### ® Demand continued to be strong from the residential construction and rem gas, food service and equipment, and transportation markets. Demand in capital goods markets, such as chemical processing and power generatic http://www.investquest.com/iq/a/ati/ne/earnings/ati 15.htm 8/8/2005 

### AlleghenyTechnologies Page 2of10 flat-rolled products remained solid. "In our Engineered Products segment, operating margins increased to over 12°;; ATI Business System improvements and strong demand from several key mark, and gas, aerospace, and transportation markets as well as general manufacturil "We remain optimistic aboutthe prospectsforAT!. Backlogs in our High Perforn segment are at near record levels and lead times continue to lengthen. We expE demand for our materials used forjetengine after-market parts and new commE engines and airframes. In addition, we see continued strength for our exotic allo Rolled Products segment, capital goods markets are expected to remain strong. stainless steel service center supply chain inventories will be in balance bythe E second quarter2005. The global electrical steel markets for power distribution a added supply as that market gains momentum. Markets for our Engineered Pro! businesses remain robust."

Sales Net income (loss)

Net income (loss)

First Quarter2005 Financial Highlights Three Mont Marcr In Mil] 2005 $ 879.6 $ 66.3 Per Dilut $ 0.66

CI Sales were $879.6 million, 52% higherthan the first quarter2004. Sales i in the Flat-Rolled Products segment, 47% in the High Performance Metal 32% in the Engineered Products segment. • Segment operating profitwas $113.9 million, an increase of$113.3 millie the first quarter2004, as a result of improved performance across all thre segments. First quarter2005 results included a LIFO inventoryvaluation of$5.7 million, due primarilyto higher titanium scrap costs. The LIFO inventory valuation reserve charge was 

### $L the first quarter2004. • Net income was $66.3 million, or$0.66 per share. CI Retirement benefitexpensewas $20.2 million compared to $36.0 million primarily as a result ofactions taken in the second quarter2004to contro medical costs and the favorable effect ofthe Medicare prescription drug" CI Cash flow used in operations was $4.7 million. Improved market conditio the further investmentof$122.2 million in managed working capital. • Cash on hand was $231.2 million at March 31,2005. • Cost reductions, before the effects of inflation, totaled $30 million compa quarter. Our2005 cost reduction goal is $100 million. Flat-Rolled Products Segment Market Conditions

CI Demand continued to be strong from the residential construction and rem gas, food service and equipment, and transportation markets. Demand in capital goods markets, such as chemical processing and power generatic 

### http://www.investquest.comliq/a/ati/ne/earnings/atiI5.htm 8/8/2005

### Allegheny Technologies Page 3 of 10 Demand remained good from the automotive market for our specialty pro improved our position for automotive exhaust alloys as a result of the J&L acquisition. First quarter 2005 compared to first quarter 2004 

### ® Sales increased 59% to $524.9 million primarily due to improved demand selling prices, higher raw material surcharges, and higher shipments inch. from the Midland , PA and Louisville, OH facilities acquired in June 2004. ' tons shipped increased by over 47,800 tons, or 38%. Shipments of comrr increased 49% and shipments of high-value products increased 13%. Av( transaction prices, which include surcharges, were 17% higher for comm( and 25% higher for high-value products. ® Segment operating income was $39.2 million, an increase of $50.2 milliorresult of increased shipments, higher base-selling prices, additional surclbenefits of gross cost reductions, and no LIFO inventory valuation reservf quarter 2004 results had a LIFO inventory valuation reserve charge of $3 ® Results benefited from $23.1 million in gross cost reductions , before the E inflation. High Performance Metals Segment Market Conditions 

### ® Demand for our titanium alloys, nickel-based superalloys, and vacuum-m, steels was strong from the aerospace, biomedical, and power generation exotic alloys business continued to benefit from sustained high demand fl government and medical markets, and from corrosion markets particularl, First quarter 2005 compared to first quarter 2004 

### ® Sales increased 47% to $262.7 million. Shipments increased 22% for titai 16% for nickel-based and specialty steel alloys, but decreased 13% fore; primarily to product mix. Average selling prices increased 52% for titaniur for nickel-based and specialty steel alloys, and 11 % for exotic alloys. ® Operating profit was $63.5 million, an increase of $55.7 million, as a resu shipments for most products, higher selling prices, and the benefits of grc reductions. Raw material cost inflation and higher inventory levels resulte inventory valuation reserve charge of $6.0 million in 2005 compared to a charge in 2004. • Results benefited from $5.5 million of gross cost reductions, before the of inflation. Engineered Products Segment Market Conditions 

### ® Demand for our tungsten products was strong from the oil and gas, aeros general manufacturing markets. Demand remained strong for our forged I the Class 8 truck, and construction and mining markets. Demand for our was strong from the transportation, wind energy, and oil and gas markets First quarter 2005 compared to first quarter 2004 

### ® Sales improved 32% to $92.0 million due to increased volume and higher ® Operating profit improved to $11.2 million, a $7.4 million increase, due to volumes, improved pricing, cost reductions and lower LIFO inventory vale, charges. Changes in raw material costs and inventory levels resulted in a inventory valuation reserve gain of $0.3 million in 2005 compared to a $1 charge in 2004. ® Results benefited from $1.5 million of cost reductions, before the effects c http://www.investquest.com/iq/a/ati/ne/eamings/atil5.htm 8/8/2005 

### AlleghenyTechnologies Page 3of10 Demand remained good from the automotive marketfor our specialty pro, improved our position for automotive exhaust alloys as a result ofthe J&L acquisition. Firstquarter2005 comparedto firstquarter2004

II Sales increased 59% to $524.9 million primarily dueto improved demand selling prices, higher raw material surcharges, and higher shipments inciL from the Midland, PA and Louisville, OH facilities acquired in June 2004. ' tons shipped increased by over47,800 tons, or 38%. Shipments ofcomrr increased 49% and shipments ofhigh-value products increased 13%. AVI transaction prices, which include surcharges, were 17% higherfor comml and 25% higherfor high-value products. II Segment operating income was $39.2 million, an increase of$50.2 millior result of increased shipments, higher base-selling prices, additional surcr benefits ofgross cost reductions, and no LIFO inventoryvaluation reservl quarter2004 results had a LIFO inventoryvaluation reserve charge of$3 II Results benefited from $23.1 million in gross cost reductions, before the E inflation. High Performance Metals Segment Market Conditions

II Demand for ourtitanium alloys, nickel-based superalloys, and vacuum-m steels was strong from the aerospace, biomedical, and power generation exotic alloys business continued to benefitfrom sustained high demand fl government and medical markets, and from corrosion markets**particularl~** Firstquarter2005 comparedto firstquarter2004

II Sales increased 47% to $262.7 million. Shipments increased 22% fortitaJ 16% for nickel-based and specialty steel alloys, but decreased 13%for e: primarilyto product mix. Average selling prices increased 52% fortitaniur for nickel-based and specialty steel alloys, and 11

### %for exotic alloys. • Operating profit was $63.5 million, an increase of$55.7 million, as a resu shipmentsfor most products, higherselling prices, and the benefits ofgrc reductions. Raw material cost inflation and higher inventory levels resulte inventoryvaluation reserve charge of$6.0 million in 2005 compared to a ' charge in 2004. • Results benefited from $5.5 million ofgross cost reductions, before the ef inflation. Engineered Products Segment Market Conditions
• Demand for ourtungsten products was strong from the oil and gas, aeros general manufacturing markets. Demand remained strong for ourforged I the Class 8truck, and construction and mining markets. Demand for our I was strong from the transportation, wind energy, and oil and gas markets Firstquarter2005 comparedto first quarter2004
• Sales improved 32% to $92.0 million due to increased volume and higher II Operating profit improved to $11.2 million, a $7.4 million increase, due to volumes, improved pricing, cost reductions and lower LIFO inventoryvaiL charges. Changes in raw material costs and inventory levels resulted in a inventoryvaluation reserve gain of$0.3 million in 2005 compared to a $1 charge in 2004. • Results benefited from $1.5 million ofcost reductions, beforethe effects ( 

### http://www.investquest.comiiq/a/ati/ne/eamings/atiI5.htm 8/8/2005

### Allegheny Technologies Page 4 of 10 Retirement Benefit Expense ® Retirement benefit expense declined to $20.2 million in the first quarter 2( to $36.0 million in the first quarter 2004, primarily as a result of actions tal second quarter 2004 to control retiree medical costs and the favorable efi Medicare prescription drug legislation. ® For the first quarter 2005, retirement benefit expense included in cost of million, and in selling and administrative expenses was $6.0 million. For tl 2004, retirement benefit expense included in cost of sales was $27.6 milli selling and administrative expenses was $8.4 million. ® Retirement benefit expense for the full year 2005 is expected to decline t( $81 million from $120 million in 2004. The pension expense portion of ret expense is expected to decrease to pproximately $63 million for 2005 cor million in 2004 as actual returns on pension assets in 2004 were higher tt This decrease is partially offset by a lower assumed discount rate to valu( benefit liabilities. Postretirement medical expense for 2005, which is now approximately $17 million compared to $46 million for 2004, will continue the actions taken in the second quarter 2004 to control retiree medical co partially offset by a lower assumed discount rate to value plan liabilities. 1 2005 postretirement medical expense reflects a $7 million reduction from 2005 estimate due primarily to a revision of the projected impact of the M. prescription drug legislation resulting from updated regulations. ® ATI is not required to make cash contributions to its U.S. defined benefit I for 2005, and based on current regulations and actuarial studies, ATI doe be required to make cash contributions to its U.S. defined benefit pensior the next several years. However, we may elect, depending upon investmf performance of the pension plan assets and other factors, to make volunt contributions to this pension plan in the future. Other Expenses 

### ® Corporate expenses for the first quarter 2005 were $10.3 million comparE million in the year-ago period. This increase is due primarily to expenses cash and equity-based long-term performance-based incentive compens< ® Excluding the effects of retirement benefit expense, selling and administr, as a percentage of sales declined to 6.3% in the 2005 first quarter from 7 same period of 2004. ® First quarter 2005 interest expense, net of interest income, increased to from $8.2 million in the year-ago period primarily related to interest assoc financing of the June 2004 J&L asset acquisition and higher short-term in Income Taxes 

### The 2005 first quarter includes a provision for income taxes of $2.3 million, whic related to foreign and state income taxes. No income tax provision or benefit wa in 2004. We maintain a valuation allowance for a major portion of our deferred ti accordance with SFAS No. 109, "Accounting for Income Taxes". Future tax prop benefits will be recognized when taxable income exceeds net operating tax loss resulting in cash tax payments, or when tax losses, if any, are recoverable as ce due to changes in our judgment regarding the realizability of our deferred tax as Cash Flow, Working Capital and Debt 

### ® Cash on hand was $231.2 million at March 31, 2005.Cash flow used in or during the first quarter 2005 was $4.7 million as the significant improvem( earnings was more than offset by a $122.2 million investment in manage( capital. ® The investment in managed working capital resulted from a $68.2 million accounts receivable, which reflects the significantly higher level of sales ii quarter 2005 compared to the fourth quarter 2004, and a $63.3 million inc inventory mostly as a result of higher raw material costs and increased bi volumes, partially offset by a $9.3 million increase in accounts payable. N http://www.investquest.com/iq/a/ati/ne/eamings/atil5.htm 8/8/2005 

### AlleghenyTechnologies Page4 of10 Retirement Benefit Expense

o Retirement benefit expense declined to $20.2 million in the first quarter2( to $36.0 million in thefirst quarter2004, primarily as a result ofactions tal second quarter2004 to control retiree medical costs and the favorable eft Medicare prescription drug legislation. o Forthe first quarter2005, retirement benefit expense included in cost of**~** million, and in selling and administrative expenses was $6.0 million. Fortl 2004, retirement benefit expense included in cost ofsales was $27.6 milli selling and administrative expenses was $8.4 million. o Retirement benefit expense forthe full year2005 is expected to declinet< $81 million from $120 million in 2004. The pension expense portion ofret expense is expected to decreaseto pproximately $63 million for2005 cor million in 2004 as actual returns on pension assets in 2004 were higher

### tt This decrease is partially offset by a lower assumed discount rate to valw benefit liabilities. Postretirement medical expense for 2005, which is now approximately $17 million compared to $46 million for2004, will continue the actions taken in the second quarter2004 to control retiree medical co partially offset by a lower assumed discount rate to value plan liabilities. 1 2005 postretirement medical expense reflects a $7 million reduction from 2005 estimate due primarilyto a revision ofthe projected impact ofthe 

### M prescription drug legislation resulting from updated regulations. o ATI is not required to make cash contributions to its U.S. defined benefit 1 for2005, and based on current regulations and actuarial studies, ATI doe be required to make cash contributions to its U.S. defined benefit pensior the next several years. However, we may elect, depending upon investmE performance ofthe pension plan assets and otherfactors, to make volunt contributions to this pension plan in the future. Other Expenses

o Corporate expensesforthe first quarter2005 were $10.3 million comparE million in the year-ago period. This increase is due primarilyto expenses cash and equity-based long-term performance-based incentive compens, o Excluding the effects of retirement benefit expense, selling and administrc as a percentage ofsales declined to 6.3% in the 2005 first quarterfrom 7 same period of2004. o First quarter2005 interest expense, netofinterest income, increased to**~** from $8.2 million in the year-ago period primarily related to interestassoc financing oftheJune2004 J&L asset acquisition and higher short-term in IncomeTaxes The 2005 first quarter includes a provision for income taxes of$2.3 million, whic related to foreign and state incometaxes. No incometax provision or benefitwa in 2004. We maintain a valuation allowancefor a major portion ofourdeferred t; accordance with SFAS No.109, "Accounting for Income Taxes". Future tax prO\ benefits will be recognized when taxable income exceeds net operating tax loss resulting in cash tax payments, orwhen tax losses, ifany, are recoverable as CE due to changes in ourjudgment regarding the realizability ofourdeferred tax as Cash Flow, Working Capital and Debt
• Cash on hand was $231.2 million at March 31, 2005.Cash flow used in 

### 01 during the first quarter2005 was $4.7 million as the significant improvemE earnings was morethan offset by a $122.2 million investment in manage< capital. o The investment in managed working capital resulted from a $68.2 million accounts receivable, which reflects the significantly higher level ofsales il quarter2005 compared to the fourth quarter2004, and a $63.3 million inc inventory mostly as a result of higher raw material costs and increased bL volumes, partially offset by a $9.3 million increase in accounts payable. 

### til 

### http://www.investquest.comliq/a/ati/ne/eamings/atiI5.htm 8/8/2005

### Allegheny Technologies Page 5 of 10 increase in raw material costs is expected to be recovered through surch, pricing mechanisms. ® At March 31, 2005, managed working capital improved to 27.2% of annuE compared to 29.5% of annualized sales at year-end 2004. We define mar capital as accounts receivable and gross inventories less accounts payat in investing activities was $7.8 million in the first quarter 2005 and consist capital expenditures. ® Cash used in financing activities was $7.1 million in the first quarter 2005 decrease in net borrowings of $5.8 million and payment of dividends of $! offset by $4.5 million of proceeds received from the exercise of stock opti, ® Net debt as a percentage of total capitalization improved to 39.4% at Mar from 43.8% at the end of 2004. ® There were no borrowings outstanding during 2005 or 2004 under ATI's secured domestic borrowing facility, although a portion of the letters of crn was utilized. New Accounting Pronouncement Adopted in 2005 

### In the first quarter 2005, the Company adopted Statement of Financial Accounti No. 123R, "Share-Based Payment". Under the revised standard, companies ma account for share-based compensation transactions, such as stock options, resl and potential payments under programs such as our Total Shareholder Return r intrinsic value method as defined in APB Opinion No. 25. Instead, companies ar account for such equity transactions using an approach in which the fair value o estimated at the date of grant and recognized as an expense over the requisite Compensation expense is adjusted for equity awards that do not vest because performance conditions are not satisfied. However, compensation expense alre; is not adjusted if market conditions are not met, such as stock options expiring money". We adopted the new standard using the modified prospective method with the first quarter 2005 will reflect compensation expense in accordance with 123R transition provisions. Under the modified prospective method, the effect of is recognized in the period of adoption and in future periods. Prior periods are ni reflect the impact of adopting the new standard at earlier dates. First quarter 2005 compensation expense related to share-based incentive plan million compared to $1.2 million in the first quarter 2004. First quarter 2005 shar compensation expense includes $0.8 million related to expensing of stock optioi Allegheny Technologies will conduct a conference call with investors and analy: 2005, at 1 p.m. ET to discuss the financial results. The conference call will be br www.alleghenytechnologies.com. To access the broadcast, click on "Confereno addition, the conference call will be available through the CCBN website, locate, www.ccbn.com. 

### This news release contains "forward-looking statements" within the meaning of Securities Litigation Reform Act of 1995. Certain statements in this news release future events and expectations and, as such, constitute forward-looking statemE looking statements include those containing such words as "anticipates," "belie "estimates," "expects," "would," "should," "will," "will likely result," "forecast," "ou "projects," and similar expressions. Forward-looking statements are based on rr current expectations and include known and unknown risks, uncertainties and o many of which we are unable to predict or control, that may cause our actual re,, performance or achievements to materially differ from those expressed or impliE forward-looking statements. Important factors that could cause actual results to from those in the forward-looking statements include: (a) material adverse char economic or industry conditions generally, including global supply and demand prices for our specialty materials; (b) material adverse changes in the markets v including the commercial aerospace, construction and mining, automotive, elect chemical process industry and oil and gas, government, and other markets; (c) achieve the level of cost savings, productivity improvements, synergies, growth benefits anticipated by management, including those anticipated from the integr acquired businesses, whether due to significant increases in energy, raw mated employee benefits costs or other factors; (d) volatility of prices and availability o' http://www.investquest.com/iq/a/ati/ne/eamings/atil5.htm 8/8/2005 

### AlleghenyTechnologies Page 5of10 increase in raw material costs is expected to be recovered through surch, pricing mechanisms. G At March 31,2005, managed working capital improved to 27.2% ofannuc compared to 29.5% ofannualized sales at year-end 2004. We define mar capital as accounts receivable and gross inventories less accounts payat in investing activities was $7.8 million in the first quarter2005 and consisl capital expenditures. G Cash used in financing activities was $7.1 million in the first quarter2005 decrease in net borrowings of$5.8 million and payment ofdividends of$! offset by $4.5 million ofproceeds received from the exercise ofstock opH G Net debtas a percentage oftotal capitalization improved to 39.4% at Mar from 43.8% at the end of2004. G There were no borrowings outstanding during 2005 or 2004 underATI's**~** secured domestic borrowing facility, although a portion ofthe letters ofcn was utilized. NewAccounting PronouncementAdopted in 2005 In the first quarter2005, the Company adopted Statement of Financial Accounti No. 123R, "Share-Based Payment". Underthe revised standard, companies ma accountfor share-based compensation transactions, such as stock options, res1 and potential payments under programs such as ourTotal Shareholder Return 

## r intrinsicvalue method as defined in APB Opinion No. 25. Instead, companies ar accountfor such equitytransactions using an approach in which the fair value 0 estimated at the date ofgrant and recognized as an expense overthe requisite Compensation expense is adjusted for equity awardsthat do notvest because**~** performance conditions are not satisfied. However, compensation expense alre, is not adjusted ifmarket conditions are not met, such as stock options expiring" money". We adopted the new standard using the modified prospective method ( with the first quarter2005 will reflect compensation expense in accordance with 123Rtransition provisions. Underthe modified prospective method, the effect 01 is recognized in the period ofadoption and in future periods. Prior periods are n' reflectthe impactofadopting the new standard at earlier dates. First quarter2005 compensation expense related to share-based incentive plan million compared to $1.2 million in the first quarter2004. First quarter2005 shar compensation expense includes $0.8 million related to expensing ofstock optiol Allegheny Technologies will conduct a conference call with investors and**analy~** 2005, at 1 p.m. ET to discuss the financial results. The conference call will be br www.alleghenytechnologies.com.Toaccessthebroadcast.click on "Confereno addition, the conference call will be available through the CCBN website, locate, www.ccbn.com. This news release contains "forward-looking statements" within the meaning of i Securities Litigation Reform Act of 1995. Certain statements in this news releast future events and expectations and, as such, constitute forward-looking statemE looking statements include those containing such words as "anticipates," "belie\! "estimates," "expects," "would," "should," "will," "will likely result," "forecast," "ou "projects," and similarexpressions. Forward-looking statements are based on rr current expectations and include known and unknown risks, uncertainties and 0 many ofwhich we are unableto predict or control, that may cause ouractual rel performance or achievements to materially differfrom those expressed or impliE forward-looking statements. Importantfactors that could cause actual results to from those in the forward-looking statements include: (a) material adverse chan economic or industry conditions generally, including global supply and demand, prices for our specialty materials; (b) material adverse changes in the markets VI including the commercial aerospace, construction and mining, automotive, elect chemical process industry and oil and gas, government, and other markets; (c) t achieve the level ofcost savings, productivity improvements, synergies, growth benefits anticipated by management, including those anticipated from the integr acquired businesses, whether due to significant increases in energy, raw materi employee benefits costs or otherfactors; (d) volatility of prices and availability

### 0: http://www.investquest.comliq/a/atilne/eamings/atiI5.htm 8/8/2005

### Allegheny Technologies Page 6 of 10 raw materials that are critical to the manufacture of our products; (e) declines in our defined benefit pension plan assets or unfavorable changes in laws or regul govern pension plan funding ; (f) significant legal proceedings or investigations a and (g) the other risk factors summarized in our Annual Report on Form 10-K fo ended December 31, 2004, and other reports filed with the Securities and Exchi Commission
. We assume no duty to update our forward -looking statements. Allegheny Technologies Incorporated (NYSE:ATI) is one of the largest and mos specialty materials producers in the world, with revenues of approximately $2.7 2004. The Company has approximately 9,000 full-time employees world-wide w innovative technologies and advanced research and development to offer growi markets a wide range of specialty materials solutions. High-value products inclu based and cobalt-based alloys and superalloys, titanium and titanium alloys, spy super stainless steel, exotic alloys, which include zirconium, hafnium and niobiu materials, and highly engineered strip and Precision Rolled Strip® products. In produce commodity specialty materials such as stainless steel sheet and plate, steels, and forgings and castings. The Allegheny Technologies website can be t w .al leghentechnologles.com.
Allegheny Technologies Incorporated and Subsidiaries Consolidated Statements of Operations (Unaudited - Dollars in millions, except per share amounts) Three Mor Marc 2005

Sales $ 879.6 Costs and expenses: Cost of sales 738.3 Selling and administrative expenses 61.5 Income (loss) before interest, other income

(expense) and income taxes 79.8 Interest expense, net (10.4) Other income (expense), net (0.8) Income (loss) before income tax provision 68.6 Income tax provision 2.3
Net income (loss) $ 66.3 Basic net income (loss) per common share $ 0.69
Diluted net income (loss) per common share $ 0.66

Weighted average common shares outstanding -- basic (millions) 95.4 Weighted average common shares outstanding -- diluted (millions) 99.9 Actual common shares outstanding-- end of period (millions) 96.4 

### http://www.investquest.com/iq/a/ati/ne/eamings/atII5.htm 8/8/2005 

### AlleghenyTechnologies Page 6 of10 raw materials that are critical to the manufacture ofour products; (e) declines in our defined benefit pension plan assets or unfavorable changes in laws or regul govern pension plan funding; (f) significant legal proceedings or investigations a and (g) the other risk factors summarized in ourAnnual Report on Form 1O-K fo ended December 31,2004, and other reports filed with the Securities and Exch, Commission. We assume no dutyto update ourforward-looking statements. Allegheny Technologies Incorporated (NYSE:ATI) is one ofthe largest and mos specialty materials producers in the world, with revenues ofapproximately $2.7 2004. The Company has approximately 9,000 full-time employees world-wide w innovative technologies and advanced research and developmentto offergrowi markets awide range ofspecialty materials solutions. High-value products inclu based and cobalt-based alloys and superalloys, titanium and titanium alloys, Spl superstainless steel, exotic alloys, which include zirconium, hafnium and niobiu materials, and highly engineered strip and Precision Rolled Strip® products. In 

### c produce commodity specialty materials such as stainless steel sheet and plate, steels, and forgings and castings. The Allegheny Technologies website can be f
Allegheny Technologies Incorporated and Subsidiaries Consolidated Statements of Operations (Unaudited

- Dollars in millions, except per share amounts)

Sales Costs and expenses: Cost of sales Selling and administrative expenses Income (loss) before interest, other income (expense) and income taxes Interest expense, net Other income (expense), net Income (loss) before income tax provision Income tax provision
Net income (loss)
Basic net income (loss) per cornmon share
Diluted net income (loss) per cornmon share
Weighted average common shares outstanding

-- basic (millions) Weighted average common shares outstanding

-- diluted (millions) Actual common shares outstanding-- end of period (millions) $

$ $ $Three Mor Marc 2005

879.6 738.3

61.5
79.8 (10.4)

(0.8) 68.6

2.3
66.3
0.69
0.66

95.4
99.9
96.4 

### http://www.investquest.com/iq/a/ati/ne/eamings/ati15.htm 8/8/2005

### Allegheny Technologies Page 7 of 10 Allegheny Technologies Incorporated and Subsidiaries Sales and Operating Profit (Loss) by Business Segment (Unaudited - Dollars in millions)

Sales: Flat-Rolled Products High Performance Metals Engineered Products

Total External Sales
Operating Profit (Loss): Flat-Rolled Products % of Sales High Performance Metals % of Sales Engineered Products % of Sales
Operating Profit (Loss) % of Sales Corporate expenses Interest expense, net

Subtotal Other expense, net of gains on asset sales Retirement benefit expense
Income (loss) before income taxes

Allegheny Technologies Incorporated and Subsidiaries Consolidated Balance Sheets (Current period unaudited--Dollars in millions) Q1 2C
$524. 262. 92.
$879.

$ 39. 7. 63. 24.

113. 12. (10. (10.

93. (4. (20.

$ 68.

March 31, 2005
ASSETS
Current Assets: Cash and cash equivalents $ 231.2 Accounts receivable, net of allowances for doubtful accounts of $9.1 and $8.4 at March 31, 2005 and December 31, 2004, 

### http://www.investquest.com/iq/a/ati/ne/eamings/atil5.htm 8/8/2005 

### AlleghenyTechnologies Page7 of10 Allegheny Technologies Incorporated and Subsidiaries Sales and Operating Profit (Loss) by Business Segment (Unaudited

- Dollars in millions)

Sales: Flat-Rolled Products High Performance Metals Engineered Products
Total External Sales Operating Profit (Loss): Flat-Rolled Products % of Sales High Performance Metals % of Sales Engineered Products % of Sales Operating Profit (Loss) % of Sales Corporate expenses Interest expense, net
Subtotal Other expense, net of gains on asset sales Retirement benefit expense
Income (loss) before income taxes
Allegheny Technologies Incorporated and Subsidiaries Consolidated Balance Sheets (Current period unaudited--Dollars in millions) Ql 2C $524.

262.

92. $879.

$ 39. 7. 63. 24. 11. 12.
113.

12. (10. (10.

93. (4. (20.
$ 68.

March 31, I 2005 ASSETS Current Assets: Cash and cash equivalents Accounts receivable, net of allowances for doubtful accounts of $9.1 and $8.4 at March 31, 2005 and December 31, 2004, $ 231.2



### http://www.investquest.comliq/a/ati/ne/eamings/atiI5.htm 

### 8/8/2005

### Allegheny Technologies Page 8 of 10 respectively 425.6 Inventories, net 568.1 Prepaid expenses and other current assets 48.0 Total current assets 1,272.9 Property, plant and equipment, net 709.5 Cost in excess of net assets acquired 206.6 Deferred pension asset 122.3 Deferred income taxes 53.4 Other assets 61.4

Total Assets $ 2,426.1

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Accounts Liabilities:

payable $ 281.4 Accrued liabilities 201.7 Short term debt and current portion of long-term debt 26.7 Total current liabilities 509.8
Long-term debt 549.6 Accrued postretirement benefits 470.5 Pension liabilities 255.6 Other long-term liabilities 109.5 Total liabilities 1,895.0

------------ Total stockholders' equity 531.1

Total Liabilities and Stockholders' Equity $ 2,426.1

Allegheny Technologies Incorporated and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited--Dollars in millions) Three Mor Max 2005
Operating Activities: Net income (loss) $ 66.E Depreciation and amortization 17.E Change in managed working capital (122.2 Change in pension assets/liabilities 14., Postretirement benefits (2.2 Accrued liabilities and other 20.S 

### http://www.investquest.com/iq/a/ati/ne/earnings/ati 15.htm 8/8/2005 

### AlleghenyTechnologies respectively Inventories, net Prepaid expenses and other current assets Total current assets Property, plant and equipment, net Cost in excess of net assets acquired Deferred pension asset Deferred income taxes Other assets
Total Assets
LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable Accrued liabilities Short term debt and current

portion of long-term debt

Total current liabilities Long-term debt Accrued postretirement benefits Pension liabilities Other long-term liabilities Total liabilities
Total stockholders' equity
Total Liabilities and Stockholders' Equity $

$

$ 

### Page 8of10 425.6 568.1

48.0 1,272.9 709.5 206.6 122.3

53.4 61. 4 2,426.1

281.4 201.7

26.7 509.8
549.6 470.5 255.6 109.5 1,895.0
531.1 2,426.1
Allegheny Technologies Incorporated and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited--Dollars in millions)

Operating Activities: Net income (loss) Depreciation and amortization Change in managed working capital Change in pension assets/liabilities Postretirement benefits Accrued liabilities and other Three Mor Mar 2005

$**66.~** 

### 17.E (122.:::**14.~** (2.:::**20.~** 

### http://www.investquest.comliq/a/ati/ne/eamings/atiI5.htm 8/8/2005

### Allegheny Technologies Page 9 of 10
Cash used in operating activities (4.; Investing Activities: Purchases of property, plant and equipment (7.1 Asset disposals and other (O.E Cash used in investing activities (7.E Financing Activities: Net decrease in debt (5. E Dividends paid (5.E Exercises of stock options 4._` Cash used in financing activities (7.1 Decrease in cash and cash equivalents (19.E Cash and cash equivalents at beginning of period 250.E Cash and cash equivalents at end of period $ 231.2

Allegheny Technologies Incorporated and Subsidiaries Selected Financial Data (Unaudited) Ql 20C Volume: Flat-Rolled Products (finished tons) 172,7E Commodity 129,94 High value 42,84 High Performance Metals (000's lbs.) Nickel-based and specialty steel alloys 0,34 Titanium mill products 6,1; Exotic alloys 1,0^ Average Prices: Fl at-Rolled Products (per finished ton) $3,01 Commodity $2,34 High value $5,1C Hi gh Performance Metals (per lb.) Nickel-based and specialty steel alloys $ 9.; Titanium mill products $17.1 Exotic alloys $40.4 All egheny Technologies Incorporated and Subsidiarie s Oth Man (Uner Financial Information aged Working Capital audited - Dollars in millions)
March 31, 2005 ecember 31, 2004 arcy

Change Workl Accounts receivable $ 425.6 $ 357.9 Inventory 568.1 513.0 

### http://www.investquest.com/iq/a/ati/ne/eamings/atil5.htm 8/8/2005 

### AlleghenyTechnologies Page 9 of10 Cash used in operating activities Investing Activities: Purchases of property, plant and equipment Asset disposals and other Cash used in investing activities Financing Activities: Net decrease in debt Dividends paid Exercises of stock options Cash used in financing activities Decrease in cash and cash equivalents Cash and cash equivalents at beginning of period (4 •**~** (7 •**~** (0. E 

### (7. E (5. E (5. E 4. : (7. ] (19.E 250. E Cash and cash equivalents at end of period $ 231.**~** Allegheny Technologies Incorporated and Subsidiaries Selected Financial Data (Unaudited)**Volum~:** Flat-Rolled Products (finished tons) Commodity High value High Performance Metals (OOO's lbs.) Nickel-based and

specialty steel alloys Titanium mill products Exotic alloys Average Prices:

Flat-Rolled Products Commodity High value (per finished ton) High Performance Metals (per lb.) Nickel-based and specialty

steel alloys Titanium mill products Exotic alloys Allegheny Technologies Incorporated and Subsidiaries Other Financial Information Managed Working Capital (Unaudited

- Dollars in millions)

Accounts receivable Inventory $March 31, 2005 December 31, 2004
425.6 $ 56S.1 357.9 513.0 Ql 20C 

### 172,7E 129, 9L

42,SL

10,3 L

6,**1~** I,**O~** $3,**O~** $2,3 L $5,lC $ 9.**~** $17
.**~** $40.L

Marcr Change Workj



### http://www.investquest.com!iq/a/ati/ne/eamings/atiI5.htm 8/8/2005

### Allegheny Technologies Page 10 of 10 Accounts payable (281.4) (271.2)

-------------- --------------- Subtotal 712.3 599.7 Allowance for doubtful accounts 9.1 8.4 LIFO reserve 229.6 223.9 Corporate and other 23.8 20.6 Managed working capital $ 974.8 $ 852.6 $
Annualized prior 2 months sales $ 3,588.0 $ 2,887.0
-------------- --------------- Managed working capital as a % of annualized sales 27.2% 29.5% As part of managing the liquidity in our business, we focus controlling managed working capital, which is defined as gz accounts receivable and gross inventories, less accounts pa measuring performance in controlling this managed working c exclude the effects of LIFO inventory valuation reserves, E obsolete inventory reserves, and reserves for uncollectiblE receivable which, due to their nature, are managed separatE
Allegheny Technologies Incorporated and Subsidiaries Other Financial Information Net Debt to Capital (Unaudited - Dollars in millions) March 31, Dec 2005
Total debt $ 576.3 $ Less: Cash (231.2)

--------------- ---- Net debt $ 345.1 $ Net debt $ 345.1 $ Stockholders' equity 531.1 Total capital $ 876.2 $ Net debt to capital ratio 39.4%
In managing the overall capital structure of the Company, c measures on which we focus is net debt to total capitalizat is the percentage of debt to the total invested and borrowE of the Company. In determining this measure, debt and totE capitalization are net of cash on hand which may be availal reduce borrowings.



### http://www.investquest.com/iq/a/ati/ne/eamings/atil5.htm 8/8/2005 AlleghenyTechnologies Accounts payable Subtotal Allowance for doubtful

accounts LIFO reserve Corporate and other Managed working

capital
Annualized prior 2

months sales Managed working

capital as a % of annualized sales$

$ (281.4) 712.3
9.1 229.6

23.8
974.8 $

3,588.0 $

27.2% 

### Page 10 of10 (271.2) 599.7
8.4 223.9

20.6
852.6 $

2,887.0

29.5% As part of managing the liquidity in our business, we focuo controlling managed working capital, which is defined as gl accounts receivable and gross inventories, less accounts pc measuring performance in controlling this managed working c exclude the effects of LIFO inventory valuation reserves, E obsolete inventory reserves, and reserves for uncollectiblE receivable which, due to their nature, are managed separatE Allegheny Technologies Incorporated and Subsidiaries Other Financial Information Net Debt to Capital (Unaudited

- Dollars in millions) March 31, Dec

Total debt Less: Cash Net debt Net debt Stockholders' equity Total capital Net debt to capital ratio 2005 $ 576.3 $ (231. 2)

--------------- $ 345.1 $ $ 345.1 $ 531.1

--------------- $ 876.2 $ 39.4%
In managing the overall capital structure of the Company, c measures on which we focus is net debt to total capitalizat is the percentage of debt to the total invested and borrowE of the Company. In determining this measure, debt and tote capitalization are net of cash on hand which may be availat reduce borrowings. ###


### http://www.investquest.comliq/a/ati/ne/eamings/atiI5.htm 8/8/2005